Why MSPs Care More About Your Business Than Your IT Employees Do

  • A common concern with the service provider (MSP, ITSP, consultants) model for IT is that they have their own agendas and that internal IT staff will have the best interests of the business at heart, while the service provider is just out to make money. I feel that this is a myth and will break down why, when treated correctly, service provides have more opportunity to align with a business than internal IT staff do.

    First, we have to understand motivation. An MSP is, to a business, just like any other employee, just one that is a bit more complex and can do things like work more than or less than a fixed number of hours in a week. Think of an MSP as a meta-employee.

    How are all employees motivated? Money. That's how employment works - a business needs work done and offers to exchange money for someone to do that work. The idea is that the work is not something that anyone actually wants to do, but when money is offered it becomes valuable enough to be willing to do it. All employees are motivated by more money or less work for the same money and often by numerous other factors like respect, work environment, flexibility, quality of work, value of company product, location and so forth. But at the core, all employees are there to make money - this is the fundamental nature of the employee relationship. The MSP is no different.

    To a business person, such as the CEO, an internal IT resource or an external one are essentially the same. They both fall outside of the operational core of the business and are motivated to make more from less. Every business relationship between suppliers and customers works this way. Whether you are the lumber company to the general contractor, or the Windows engineer to the show factory. Internal IT people and external IT people have the same motivations at the core. This is why companies often cap hours for employees, otherwise IT staff aren't just motivated to work (or simply bill) extra hours, but once they hit a threshold those hours are normally at time and a half making the motivation to keep working extreme enticing; a moderate amount of overtime can double an individual's salary!

    Employment is also fleeting. Employees in general tend to turn over many times in their careers. IT staff notoriously do this at an incredible pace and in the SMB market almost have to do this. In order to further careers, IT staff in the SMB are forced to rapidly move to new companies with larger, different or more demanding environments. Even small companies but ones that focus on different "rungs" of the ladder can work. So the majority of the SMB IT market is in a constant scramble to move from job to job in order to keep moving up in the way that a normal staffer would advance over time working in the core operations of a large business where there is a complete career ladder within a single company. And, of course, the opposite problem exists that IT can stop moving in the SMB and stagnate with no further advancement options.

    MSPs have an opportunity to short circuit this fleeting employment model, but of course only if the business desires to do so. Unlike normal employees, MSPs seek customers for the long haul. Not just six months or two years until they have amassed new skills, built up another bit of their resume and manage to find a new employer with deeper pockets, but rather holding a customer as long as the relationship makes sense, possibly for decades. MSPs that trust their customer relationships have a strong motivation to plan well and be along for the long term, unlike internal staff which has little incentive to invest heavily at any single job. MSPs, internally, do the same thing with IT staff by moving them from the fleeting nature of "ancillary department" to the stability of "core operations." An MSP makes it possible for IT staff to stay with a single company for much longer, even a complete career length, while still being trained, motivated and advancing.

    MSPs also manage to maintain tribal knowledge and stability by keeping staff internal that might move from client to client. Instead of IT staff leaving a customer and never being available to them again as in the internal staff model, MSP staff that focuses on a different customer is still around to be consulted about missing documentation, tribal knowledge, history events, business needs, etc. Knowledge transfers have far more likelihood of being possible and of happening at all.

    An MSP that does a good job hopes that customers will recommend them to other businesses and will act as a reference. Employees cannot do this, at least without having to leave the former employer. MSPs have a much better alignment to joint success in this way.

    MSPs are also aligned in growth. It is strongly in the interest of an MSP to grow their customers. As customers grow the dependence on the IT department gets larger both in scale of needs and also in scope. The five person desktop support customer of today could be the big SAN, virtualization and security customer of five hundred desktops tomorrow. An internal IT staffer might be motivated to "grow with the company" but growth is high risk to internal staff that might be left at the bottom rung or might find their skill set no longer needed to the company. At most the benefits of growth to an internal employee are minimal while the benefits to an MSP are potentially enormous. Internal staff often benefits from companies shrinking or even failing, whereas MSPs realistically only benefit from success. The MSP model allows for better alignment of values and goals.

    Internal IT staff has a natural limit in smaller shops on the range of skills and experience that they can have, this creates a huge motivation to invest in those skills and to push the business to use those technologies regardless of their suitability for the business. MSPs are also motivated by this, but the motivation is less, to some degree, because there is far more opportunity to shift skills around internally at the MSP and to train staff on new skills. This is one of the larger factors in the real world with small shops often nearly totally defined by the technical limits of their internal staff.

    So through growth, alignment, references and longevity your MSP has more motivation to be a long term partner it the success of your business than internal staff does. There is always a challenge around conflicts of interest, of course, but this exists with both internal and outsources resources but through good contractual alignment with your service providers they can be an improved means of tackling this problem.

  • This really follows along well with this discussion: https://mangolassi.it/topic/11852/why-it-builds-a-house-of-cards

    It's far easier to avoid the "house of cards" motivation problems with an MSP than with internal staff.